Court Defines Exemptions To Short-Swing Profits Ban

Law360, New York (April 10, 2008, 12:00 AM EDT) -- The U.S. Court of Appeals for the Second Circuit has upheld the dismissal of a shareholder derivative suit against private equity fund manager Perseus LLC, rejecting the plaintiff's arguments regarding who is exempt from a law governing short-swing profits earned by company insiders.

In a ruling Thursday, the court found that a U.S. Securities and Exchange Commission rule that exempts directors and officers from liability under the law in issuer transactions also applies to deputized directors.

The U.S. Supreme Court has found that an individual, company...
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